Password hashing is one of the most basic security considerations that
must be made when designing any application that accepts passwords
from users. Without hashing, any passwords that are stored in your
application's database can be stolen if the database is compromised, and
then immediately used to compromise not only your application, but also
the accounts of your users on other services, if they do not use
unique passwords.

By applying a hashing algorithm to your user's passwords before storing
them in your database, you make it implausible for any attacker to
determine the original password, while still being able to compare
the resulting hash to the original password in the future.

It is important to note, however, that hashing passwords only protects
them from being compromised in your data store, but does not necessarily
protect them from being intercepted by malicious code injected into your
application itself.

Why are common hashing functions such as md5() and
sha1() unsuitable for passwords?

Hashing algorithms such as MD5, SHA1 and SHA256 are designed to be
very fast and efficient. With modern techniques and computer equipment,
it has become trivial to "brute force" the output of these algorithms,
in order to determine the original input.

Because of how quickly a modern computer can "reverse" these hashing
algorithms, many security professionals strongly suggest against
their use for password hashing.

How should I hash my passwords, if the common hash functions are
not suitable?

When hashing passwords, the two most important considerations are the
computational expense, and the salt. The more computationally expensive
the hashing algorithm, the longer it will take to brute force its
output.

There are two functions that are bundled with PHP that can perform
hashing using a specified algorithm.

The first hashing function is crypt(), which natively
supports several hashing algorithms. When using this function,
you are guaranteed that the algorithm you select is available, as PHP
contains native implementations of each supported algorithm, in case
one or more are not supported by your system.

The second hashing function is hash(), which supports
many more algorithms and variants than crypt(), but
does not support some algorithms that crypt() does.
The Hash extension is bundled with PHP, but can be disabled during
compile-time, so it is not guaranteed to be available, while
crypt() is, being in the PHP core.

The suggested algorithm to use when hashing passwords is Blowfish, as it
is significantly more computationally expensive than MD5 or SHA1, while
still being scalable.

What is a salt?

A cryptographic salt is data which is applied during the hashing process
in order to eliminate the possibility of the output being looked up
in a list of pre-calculated pairs of hashes and their input, known as
a rainbow table.

In more simple terms, a salt is a bit of additional data which makes
your hashes significantly more difficult to crack. There are a number of
services online which provide extensive lists of pre-computed hashes, as
well as the original input for those hashes. The use of a salt makes it
implausible or impossible to find the resulting hash in one of these
lists.